EY Peru: Executives' M&A expectations hit record high

COP20 Centro Financiero Lima San Isidro Surco

COP20 Centro Financiero Lima San Isidro Surco

14:30 | Lima, Jul. 11.

An unprecedented 60% of Peruvian executives expect to actively pursue M&A (Mergers and Acquisitions) in the next 12 months, targeting deals under US$250 million, EY Peru affirmed on Tuesday.

The Inca country thus beats global M&A expectations (56%) for the first time in history, EY Peru Transactions and Corporate Finance Partner Enrique Oliveros underlined.

In EY Peru's 16th Global Capital Confidence Barometer, Oliveros said dealmakers are "bullish on the number and quality of acquisition opportunities" as many Peruvian sectors are still ripe for consolidation.

In this sense, the EY Peru Lead Partner noted "pipelines are relatively healthy, and executives are cautiously optimistic about deal completions."

Overcoming Coastal El Niño

Peru seems to be overcoming the devastating Coastal El Niño floods and landslides that wreaked havoc in northern regions earlier this year.

According to the Barometer, Peruvian respondents remain "overwhelmingly upbeat about the local economy," with a staggering 95% seeing it as stable to improving thanks to strong macroeconomic fundamentals. 

M&A as alternative to organic growth

Amidst the global organic growth preference, Peruvian dealmakers have added inorganic approaches to growth (like M&A and joint ventures) to their boosting and value-increasing strategies.

In a release, Oliveros explains one of the main reasons behind this behavior is the need to venture into new geographic markets.

In this sense, Peruvian executives' main investment destinations are Peru, the United States, Brazil, India and China. 

To conclude, the EY Peru partner anticipated further "promising" outlooks, as "the Peruvian Government carries on implementing pro-business policies" that prompt businesses to cross-border dealmaking to gain access to new markets. 

The study

EY's Global Capital Confidence Barometer reveals the outlooks of top executives from a range of sectors regarding growth strategies, M&A, access to capital and the macroeconomic situation. 

The 16th edition of the biannual survey was conducted by Euromoney Institutional Investor Thought Leadership in March-April 2017.


Published: 7/11/2017
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